Part 6/12:
For business owners operating on razor-thin margins—around 3-5%—the increased labor costs are devastating. Many have no choice but to scale back hours or shutter locations altogether. Others are investing heavily in automation to survive, creating a future where fewer employees are needed, and more tasks are performed by machines.
The trend reflects a stark irony: while wages have increased, actual take-home pay has diminished for many workers who see reduced hours. Higher wages cannot offset the economic realities of fixed operational costs and shrinking profit margins. The result is a vicious cycle where increased costs lead to layoffs and further automation, further displacing entry-level workers who were originally meant to gain their start in the industry.